SAP Updates Supply Chain Solution with Version 5.0 of mySAP SCM

Adds capabilities targeting service supply chain, industry-specific functionality for retailers and manufacturers

Adds capabilities targeting service supply chain, industry-specific functionality for retailers and manufacturers

Walldorf, Germany — March 10, 2006 — German software giant SAP AG has launched a new version of its supply chain management solution, offering new capabilities intended to help companies further evolve traditional, linear supply chains into more flexible and dynamic networks of supply chain partners.

Version 5.0 of mySAP Supply Chain Management (mySAP SCM) adds new service supply chain functionality, debuts industry-specific functionality and provides capabilities intended to help companies create an adaptive supply chain network.

SAP said that the capabilities in version 5.0 address two opposing priorities: the need for efficient operations of stable business processes and the need to instantly adapt to rapidly changing business conditions.

Synchronizing the Service Supply Chain

On the service supply chain side, SAP said that while many companies have begun to recognize that the after-sales market represents a significant revenue opportunity, a critical element to serving this market is to collaborate with business partners by synchronizing and integrating a company's service supply chain with its product supply chain.

mySAP SCM achieves this, SAP said, through service parts planning and execution capabilities that leverage SAP NetWeaver, offering a solution that is integrated by design rather than stitched together after-the-fact. The new capabilities were designed enable end-to-end business process integration in complex and distributed environments, resulting in higher flexibility, visibility and adaptability to business changes, according to SAP.

The potential benefits of this approach, the solution provider said, include higher forecast accuracy and performance for all parts, including those with irregular demand patterns. This in turn results in reduced inventory levels, improved working capital and customer service levels and lower operating costs, SAP said.

Increasing Adaptability at Cat Logistics

SAP customer Caterpillar Logistics Services is currently in the process of implementing the latest release of mySAP SCM with the goals of increasing the adaptability of its service supply chain and enabling its network to intelligently replenish and produce based on actual demand.

"We chose to collaborate with SAP in the development of mySAP SCM in order to provide our customers with a comprehensive systems offering capable of delivering competitive solutions in the marketplace," said Mary Bell, chairman and president of Caterpillar Logistics Services. "The mySAP SCM offering, combined with Cat Logistics' processes and logistics professionals, will position us to continue providing global logistics excellence well into the future."

Retail-specific Functionality

Elsewhere, the new version of mySAP SCM offers industry-specific functionality, including new forecasting and replenishment for retail operations. This functionality is intended to enable retailers to strike a balance between increased customer service levels and overall lower merchandise inventory.

Updated capabilities also can help retailers replenish products with long lead times, handle seasonal products and introduce new products with short product life cycles using historical information on similar products to forecast demand, SAP said.

Companies in the apparel and footwear industry can take advantage of new supply chain planning and collaboration capabilities to help retailers plan seasonal products using seasonal views and to source and replenish these products over a global network of factories or vendors at the store, style, size or color level.

More Industries Targeted

New capabilities designed for other industries include:

  • Enhancements to help consumer products and chemicals industries companies transform their supply chains into demand-driven supply networks.

  • New project-management capabilities in SAP Advanced Planning and Optimization (SAP APO) for industrial machinery and components and aerospace and defense industries that support multilevel planning and adaptiveness in bottleneck situations.

  • Adaptive manufacturing enhancements to improve productivity and usability in planning and scheduling transactions, maintenance of the planning environment and support for integrated business planning.

  • New supply network collaboration capabilities that support Kanban and distributed manufacturing to enable supplier-managed inventory.

  • Visibility to help keep companies apprised of the health of their supply chain, send notifications when exceptions occur and track key performance indicators to help manage the supply network with maximized efficiency.
Services-based Approach

Finally, SAP said that by leveraging the NetWeaver platform, mySAP SCM can integrate with a company's existing technology infrastructure and provide visibility across the business network. In addition, the SAP NetWeaver platform allows companies to create composite applications on top of mySAP SCM and across other SAP and non-SAP solutions to evolve and maximize the performance of company-specific business processes, the solution provider said.

"To respond swiftly to shifts in customer demand, market opportunity or external threat, supply chain networks must be flexible and dynamic," said Harald Stuckert, senior vice president and general manager of extended supply chain solutions at SAP AG. "The latest release of mySAP SCM makes the vision of adaptive supply chain networks a reality. Intelligently, these networks can sense and respond to changes in market conditions and to internal supply of products and services to help companies operate more efficiently and, ultimately, more profitably."

Additional Articles of Interest

— OEMs are ready to embrace Lean Manufacturing after the 2001 recession, but traditional approaches were designed for vertically integrated enterprises. The answer to their problem? Extended Lean and Statistical Kanban. Read more in "Extended Lean Can Make Your Supply Chain Hum," only on

— Ready to go beyond traditional financial metrics to measure your company's supply chain? Read the exclusive, "A Non-traditional View of Operational Costs."

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